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| ''Banking - capital adequacy.'' | | ''Contract law.'' |
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| | The law distinguishes between a reliable claim that induces a person to enter into a contract and 'mere puff', which does not. |
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| A bank's common equity is its ordinary share capital and certain accounting reserves including retained profits.
| | It is regarded as being no more than the salesperson's harmless praise of their product. |
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| For bank capital adequacy purposes, certain items are excluded from the calculation of common equity.
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| The excluded items include amounts which would be difficult for the bank to realise under stressed conditions, for example intangible assets and most deferred tax assets.
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| | == See also == |
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| Basel III raises the minimum level, after all deductions, to 4.5% of risk weighted assets.
| | * [[Condition]] |
| | | * [[Contract]] |
| Together with the Capital Conservation Buffer of 2.5%, the minimum total common equity standard becomes 7%.
| | * [[Term]] |
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| == See also ==
| | [[Category:Compliance_and_audit]] |
| * [[Basel III]]
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| * [[Capital adequacy]]
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| * [[Capital Conservation Buffer]]
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| * [[CET1]]
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| * [[Deferred tax]]
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| * [[Equity]]
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| * [[Intangible assets]]
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| * [[Ordinary shares]]
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| * [[Preference shares]]
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| * [[Preferred stock]]
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| * [[Reserves]]
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| * [[Share]]
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| * [[Tier 1]]
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Latest revision as of 14:07, 6 July 2022
Contract law.
The law distinguishes between a reliable claim that induces a person to enter into a contract and 'mere puff', which does not.
It is regarded as being no more than the salesperson's harmless praise of their product.
See also